x Abu Dhabi, UAEThursday 18 January 2018

Lights, camera, inaction for sales

After a few years of stellar growth in the global market, camera manufacturers are suffering declining revenues. As smartphones take the place of point-and-shooters, even the addition of fancy new features isn't helping.

The UK photographic chain Jessops has gone into administration. Justin Tallis / AFP
The UK photographic chain Jessops has gone into administration. Justin Tallis / AFP

Consumer electronics are often delicate devices, prone to short-circuiting after an accidental encounter with water or cracking at the slip of a hand.

But the TG-320 digital camera can survive sandstorms, dunks under water as deep as 3 metres, falls from as high as 2 metres and temperatures as low as minus 10°C.

And all of this for just US$160 (Dh587), down from $180 earlier this year.

Still not sold? Not a lot of shoppers are, either.

While camera manufacturers are busy making fancy new models by packing in more features than ever before, they are also watching sales of their devices plummet. The market, once valued at £843 million (Dh4.69 billion) in the United Kingdom back in 2006, is projected to drop to £523m by 2016, according to the market data from Mintel, a research firm.

Similar sales drops are occurring in countries around the world.

In the United States, the average price of so-called point-and-shoot cameras has fallen over the past decade before increasing in recent years - not due to demand but because of new features that manufacturers have added to try to offset the revenue decline. A new camera cost about $158 in 2008, on average, and still runs for that amount today, although its price dropped to as low as $70 during the Christmas shopping season last year.

But prices for some models plunged to about half this amount during the US winter holiday season last year. "They've generally continued to decline," Chris Chute, the research director for worldwide digital imaging at IDC, says about both camera price points as well as sales overall.

"We started to see price points flatten out because you really can't much lower than a $70 or $80 camera sold at Christmas time and hope to make any money," adds Mr Chute.

"That's really just pushing volume at that time."

The industry's decline shows few signs of abating, particularly as sharper-shooting smartphones continue to grow in popularity. In the UK, one in 10 adults - or 3 million consumers - say they are more likely to use a smartphone rather than their old camera once it breaks, according to Mintel.

Now, budget models are in danger of becoming extinct at certain manufacturers. In March, Olympus, one of the most well-known camera makers in the world and which produces the rugged TG-320, said it was going to eliminate its cheapest line of shooters, according to The Wall Street Journal. The company's V series, which runs for less than $200 per camera, suffered from disappointing sales along with other cheap models.

To buck this trend, some manufacturers are piling more advanced features on to lower-end devices. At a product showcase event in Toronto this year, executives from Sony Canada milled about with reporters and noted more of their cameras were capable of transmitting pictures to other devices - such as laptops or desktop computers - wirelessly. The Cyber-shot WX80 and WX300, for example, both boast built-in Wi-Fi to help share images more quickly. Even so, both cameras have recently been reduced in price: the WX80, once $200, now runs for $180, while the WX300 costs $280 - down from $330.

"The reality is a lot of people are using their smartphone to take pictures," Michael Neujahr, Sony Canada's national manager for event marketing and training, told The National at the event.

Other manufacturers have also introduced Wi-Fi into their point-and-shoot models. Samsung, for one, offers the WB150F with a built-in Wi-Fi feature that lets the picture-taker upload his or her images directly to social networking sites, a TV, mobile or tablet by just pressing a button. Yet its price has also dropped, from $230 down to just $120.

"Camera companies have avoided embedding wireless in their cameras for a long time, but they're pushing more and more to do that as competition increases from smartphones," says Stephen Baker, the vice president of industry analysis for the NPD Group, a market research firm. "The problem for the camera companies is that there are costs involved and it's a lot harder to embed in the device than in a phone for the cost."

To a certain degree, the new features have helped lift the average selling price of digital point-and-shoot cameras since 2011, from $152 to $158 this year. Yet analysts are sceptical this advancement will ultimately counteract the steep drop in camera sales, especially as most smartphones already include this feature. "Wi-Fi enabled cameras are something that can stimulate value sales but I wouldn't say it's a widespread driver," says Howard Telford, a research analyst with Euromonitor, a market data firm.

Many camera makers, of course, also produce camcorders. Such is the case with Sony, Samsung and Panasonic.

But even in this category of devices, sales have been spiralling downwards for many models and manufacturers are finding themselves - once again - victim to the proliferation of smartphones. "The handycam market is a declining market," says Mr Neujahr.

In response to this change, though, Sony took some of the most popular features from its cameras and incorporated them into its HDR-AS15 camcorder. This device includes built-in Wi-Fi to share video clips, much like the WX80 and WX300 cameras, a rugged exterior ithat can take on water and mud just as certain Cyber-shot models do, as well as Carl Zeiss optics, which have been incorporated into many of Sony's best-selling cameras.

While these kinds of durable camcorders also include the popular Hero line from GoPro, they only totalled between 4 million and 5 million units sold last year, according to data from Euromonitor.

"It's another small market," says Mr Telford.

"The camcorder market has really undergone an identity crisis."

Like some of their camera counterparts, certain camcorders are also on their way to the digital graveyard. The once popular Flip line, which featured few buttons and was fairly simple to operate, is being supported with technical help just to the end of this year and remains available only until supplies run out.

"That market has just been completely eviscerated," says Mr Telfond.

In many ways, consumer electronics manufacturers have started packaging and selling features in whatever form they can - cameras and camcorders included - in the hope smartphones will not further eat into their sales. The great irony, of course, is a lot of the biggest players such as Sony and Samsung also sell mobile phones through other divisions of their parent companies.